Capital Flows, Monetary Policy and FOREX Interventions in Peru
This article explains the main features of the sterilized intervention in the foreign exchange market and the use of non-conventional policy instruments as applied by the Central Reserve Bank of Peru in order to avoid credit booms or busts in a context of a partially dollarized financial system. This monetary policy framework is based on a risk management approach that includes as the main policy tool the short-term interest rate within an inflation targeting regime. This framework helped to reduce the impact of the recent global financial crisis on the Peruvian economy and allowed to rejoin the path of growth with low inflation, avoiding major disruptions from the surge of capital inflows.
|Date of creation:||May 2011|
|Date of revision:|
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- Rodríguez, Donita & Winkelried, Diego, 2011. "¿Qué explica la evolución del tipo de cambio real de equilibrio en el Perú? 1992–2009," Revista Moneda, Banco Central de Reserva del Perú, issue 147, pages 9-14.
- Adrián Armas, 2005. "Forex interventions in Peru: 2002-2004," BIS Papers chapters, in: Bank for International Settlements (ed.), Foreign exchange market intervention in emerging markets: motives, techniques and implications, volume 24, pages 242-54 Bank for International Settlements.
- Renzo Rossini & Zenon Quispe & Rocío Gondo, 2008. "Macroeconomic implications of capital inflows: Peru 1991–2007," BIS Papers chapters, in: Bank for International Settlements (ed.), Financial globalisation and emerging market capital flows, volume 44, pages 363-387 Bank for International Settlements.
- Zenon Quispe & Renzo Rossini, 2011. "Monetary policy during the global financial crisis of 2007-09: the case of Peru," BIS Papers chapters, in: Bank for International Settlements (ed.), The global crisis and financial intermediation in emerging market economies, volume 54, pages 299-316 Bank for International Settlements.
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